Though many found Apple’s keynote yesterday underwhelming, and certainly little in the keynote was revolutionary, I’m quite excited about some of their announcements. The MacBook Air, despite the whiny criticism it seems to inspire, looks as if it will be an absolutely superb laptop. (I was originally going to write an article about why the criticism thus far against the Air is ridiculous, but Wil Shipley beat me to the punch with his usual mix of whit and rancor, so just read his rant instead.) Although I don’t personally have a use for Time Capsule, I know a large number of less technically minded friends and family that would reap huge benefits from its transparent backups, and I have to confess that I’m actually excited about the new iTunes rental service.
Yet I find myself truly angered by the iPod touch upgrade.
Early iPod touches lacked some of the applications that the iPhone has, including key productivity applications such as notes, maps, and mail. Apple announced that all new iPod touches shipping will include these applications—but that existing users need to pay $20 for them.
Some apologists have claimed that Apple was forced into charging existing iPod touch owners $20 for for accounting purposes. Although that explanation is cute, it’s wrong. No other manufacturer even pretends this problem exists. Opera happily issues free upgrades for their browser on my Wii. Nokia just released a massive free upgrade to my N800 that has literally changed how I use their product. Even Microsoft, whom everyone always likes to accuse of being Satan incarnate and interested in nothing but money, has no problems making free updates that include a raft of new features. The Windows XP service packs included support for USB 2 and .NET applications, massive upgrades to the built-in firewall, a brand-new malware removal tool, greatly enhanced graphics acceleration capabilities, upgrades to Windows Media Player so great that the current version of the application is literally unrecognizable as what originally shipped with XP, and even a tremendous update to Internet Explorer that turned it from a has-been into a decent competitor for Firefox. Microsoft provided these updates for free to all Windows XP users—even ones who bought XP back in 2001 when it was initially released, seven years ago. Apple can’t seem to provide updates to users who purchased their product four months ago.
Even Apple itself has no problem providing new features for free—when they feel like it. As recently as yesterday, the Apple TV shipped with a massive software update that allows the device to contact iTunes directly, frees it from needing to be tethered to a PC, and even the ability to browse photos on Flickr. Apple doesn’t even have a problem updating iPods, as long as the features help them move iTunes purchases. If Apple really cared about their accounting as they claim to, then they ought to be charging users a dollar to add the ability to watch iTunes rentals on their iPods as well. After all, the iPods as-shipped lack this capability, so by any reasonable standard, it qualifies as a new features. By Apple’s own accounting rules, they ought to be charging for it.
Whether Apple claims to be charging users for accounting reasons or no, the actual reason is quite simple. Apple discovered quite awhile ago that their early adopters are willing to pay more for their products. It’s why the iPhone dropped $200 in price after just a month or two, it’s why they charged $2 to active 802.11n wireless on early machines that had it, and it’s why Apple’s charging $20 to early adopters of the iPod touch now. It’s a very deliberate decision on their part to fleece their early users.
Perhaps this will work for them for the time being; I don’t know. What I do know is that they are walking a very dangerous road with these decisions. Early adopters are normally willing to pay a bit more because Apple products are a status symbol. Those with new Apple products are sending a message. By repeatedly screwing their early adopters, Apple is rapidly turning that message from “I am a hip part of the Apple revolution” to “I happily take it from Apple because I’m a corporate whore.” Combine that with the fact that many products only become popular and chic due to those early adopters—the iPod serving as the quintessential example—and Apple could rapidly find their nickel-and-dime business tactics leave them with nickel-and-dime revenues.